On April 29, Tianqi Lithium Corporation(002466) ( Tianqi Lithium Corporation(002466) ) officially released its 2021 annual report. Benefiting from the improvement of the global prosperity of new energy vehicles, the accelerated capacity expansion of lithium-ion battery manufacturers, the pick-up of downstream cathode material orders and other positive factors, Tianqi Lithium Corporation(002466) business performance achieved a Jedi reversal.
According to the disclosure of the annual report, in 2021, Tianqi Lithium Corporation(002466) achieved an operating revenue of 7.663 billion yuan, a year-on-year increase of 136.56%; The net profit was RMB 2.079 billion, with a year-on-year increase of 213.37%. It successfully turned losses into profits, with a loss of RMB 1.834 billion in 2020 and RMB 5.983 billion in 2019. Quarter by quarter, the fourth quarter of last year made the largest contribution to Tianqi Lithium Corporation(002466) revenue, with an operating revenue of 3.791 billion yuan, accounting for 49.47% of the total annual revenue; The net profit was 1.549 billion yuan, accounting for 74.51% of the annual net profit.
On the same day, Tianqi Lithium Corporation(002466) also released the first quarterly report of 2022. From January to March this year, the volume and price of main products continued to rise simultaneously, realizing an operating revenue of 5.257 billion yuan, a year-on-year increase of 481.41%; The net profit was 3.328 billion yuan, a year-on-year increase of 144265%.
talison tailings pond has been completed and put into operation
At present, Tianqi Lithium Corporation(002466) takes Chengdu as the management, trade and R & D center in China, and has lithium chemical product production bases in Shehong, Sichuan, Zhangjiagang, Jiangsu, Tongliang, Chongqing and quinana, Australia.
According to wood Mackenzie’s statistics, according to the output in 2020, Tianqi Lithium Corporation(002466) is the fourth largest supplier of lithium compounds and derivatives in the world and the second largest supplier in China and Asia.
As of December 31, 2021, Tianqi Lithium Corporation(002466) has a total capacity of 1.34 million tons of lithium concentrate and 44800 tons of lithium compounds and derivatives. The company produces chemical grade and technical grade lithium concentrates. Lithium compounds and derivatives include lithium carbonate, lithium hydroxide, lithium chloride and metal lithium. The products are widely used in many end markets, mainly including electric vehicles, energy storage systems, aircraft, ceramics and glass.
It is reported that the total capacity of global refined compounds in 2020 is 798000 tons of LCE, which is expected to increase to 1.44 million tons of LCE in 2025 and further increase to 1.553 million tons of LCE in 2031 According to the statistics of lithium branch of China Nonferrous Metals Industry Association, the output of lithium carbonate in China was 298200 tons in 2021, a year-on-year increase of 59.47%; The output of lithium hydroxide reached 190300 tons, a year-on-year increase of 105%.
In 2021, China’s lithium carbonate import increased by 61.69% year-on-year and its export increased by 4.71% year-on-year; The import of lithium hydroxide increased by 583.97% year-on-year, and the export increased by 30.15% year-on-year.
In terms of lithium resource supply of mineral and clay deposits, according to wood Mackenzie statistics, as of December 31, 2021, the greenbushes mine owned by talison, a subsidiary of Tianqi Lithium Corporation(002466) holding, has the largest lithium reserves in the world. The reported mineral reserves are 168 million tons, the grade of lithium oxide is 2.04%, containing 8.3 million tons of LCE.
On April 29, Tianqi Lithium Corporation(002466) annual report revealed that talison tailings pond had been completed and put into operation in March 2022, which could increase the capacity of lithium concentrate by 280000 tons / year. As of the disclosure date of the report, the total capacity of talison lithium concentrate was 1.62 million tons / year.
In terms of lithium brine deposits, according to wood Mackenzie statistics, sqm’s Atacama Salt Lake operation in Atacama region, Chile has the largest brine reserves, with 45.51 million tons of LCE, and has the comprehensive processing capacity of high-grade lithium ore, large reserves and low-cost; Sqm is also the world’s largest producer of lithium extraction from brine. In 2018 Tianqi Lithium Corporation(002466) successfully acquired sqm23 77% equity, becoming its second largest shareholder, Tianqi Lithium Corporation(002466) in the reporting period of 2021, the investment income recognized in the associated company was 760 million yuan.
lithium compound prices continue to rise
In 2021, the output of lithium battery new energy vehicles reached a new high every month, driving the rising demand for power batteries. The consumption of lithium batteries in the fields of intelligent wearable devices, electric tools, vacuum cleaners and energy storage continued to grow. The output of downstream ternary materials and lithium iron phosphate cathode materials continued to reach new highs, and the demand for lithium salts based on lithium carbonate and lithium hydroxide showed a jump growth.
The core of electric vehicles is lithium-ion batteries. According to the data of China Automobile Industry Association, the sales volume of electric vehicles in China in 2021 was 3.521 million, a year-on-year increase of 158%, and the penetration rate of electric vehicles reached 13%. The acceleration of electrification process has driven the significant growth of power battery shipments. According to wood Mackenzie, by 2025, the sales volume of electric passenger vehicles in China will reach 6.2 million per year, and the annual sales volume of Hybrid Electric (plug-in hybrid and hybrid) electric passenger vehicles will increase by 3.3 million.
In addition, according to the Research Report of Guotai Junan Securities Co.Ltd(601211) securities, the global sales volume of new energy vehicles in 2021 was 6.75 million, a year-on-year increase of 108%, and it is expected to reach 10 million in 2022. The global penetration rate will increase by 2021.8%. Among them, the sales volume of Shanxi Guoxin Energy Corporation Limited(600617) vehicles led the world in 2021, reaching 3.395 million vehicles, with a year-on-year increase of 155%, accounting for 50% of the global new energy vehicle market.
However, on the supply side, due to the decline in the price of lithium salt products in the early stage, some lithium mines in Australia were closed, shut down and wound up, which could not resume production in a timely manner in the short term. The construction and production cycle or resumption cycle of upstream mines was seriously mismatched with the production expansion cycle of downstream cathode materials and battery plants, resulting in the gradual transformation of lithium salt from supply-demand balance to tight supply. Stimulated by the relatively tight supply of lithium compounds and the rising industrial demand, the price of lithium compounds continued to rise.
According to the wood Mackenzie report, the contract price of battery grade lithium carbonate rose to a peak of $14319 / ton in 2018 and decreased to $10257 / ton in 2020. During this period, spot prices actually fluctuated further, falling to US $5668 / ton in 2020.
Similarly, the spot price reflects the rapid rebound of the market in 2021 and the growth rate is faster than the contract price. In 2021, the average annual contract price of battery grade lithium carbonate is about US $9527 / ton, because the lag in price calculation has a slow impact on the contract price. The agency predicts that the contract price of battery grade lithium carbonate will stabilize at US $25833 / ton around 2023; In the long run, prices are expected to remain stable (in real terms) and increase to US $30500 / ton (in nominal terms) in 2031.
